Marketing Fundamentals

Review session Midterm 2

 Topics

1. Products, services and brands (ch. 6 & 7)

2. Distribution (Place) (ch. 9)
3. Marketing communications (Promotion)
(ch. 8)
4. Pricing (ch. 10)
Marketing mix

4 P’s!!!
- Product
- Promotion
- Price
- Place
1. Create market offering that brings value to customers (important as the
customer determines the value of the product by it)
2. Develop marketing mix towards it
● Branding, packaging, labeling, product support services.
3. Build profitable customer relationships
 Product
Englobes both tangible products (goods) and intangible ones (services):

● Must be made to meet customer needs or wants, which should be fully

researched and understood.
● Anything that can be offered in a market for attention, acquisition, use or
consumption.
● No product is entirely tangible or intangible, they are usually a mix of
both.This is important as it increases its competitiveness → What will
differentiate MY product?
Product attributes
Must be designed in a way in which they satisfy
customers needs and wants.

Quality (level and consistency)

Could they fail? Yes if they…
Features (differentiate product cost-value
analysis should be executed) ● Don’t perform well
● Don’t suit the consumer
Style (appearance) ● Aren’t approved by social
network of buyer
Design (usefulness and looks).
● Poor value
● Non-delivery
Level of product
- CCV/ Core benefit - What is the buyer
really buying?
- AcP - turn core benefit into actual
product: develop product and service
features, design, quality level, brand
name and packaging.
- AgP - What additional services or
benefits will I include to furthermore
differentiate/ enhance my product?

Customer value increases as levels increase

Perceived product differs for every person.

Consumer products

Product Buying Thoughtfulness Price Access

frequency (comparison)

Convenience Often Minimum Low Easy

Shopping Not often High High+deep sales Hard

support

Speciality Unique Not at all High (willing to Hard

make special
purchase effort)

Unsought Not often High High Easy (lot of

promotion)
Brand

Brand: name, term, sign, design, or a combination of these, that identifies the
maker or seller of a product. They represent everything that the product means
to the consumer. Brand equity vs. brand value.

Must be memorable, meaningful, likable, transferable, adaptable, protectable.

Brands are a promise between the firm and
the consumer
Brand development
Packaging, label and product support
services

Packaging: designing and producing the container/wrapper for a product. May

be the last way of influencing people to buy.

Label: identify the product or brand, describe attributes, and provide promotion.

Product support services: augment actual product.

Product line

Group of products that are closely related because they function in similar
manner, are sold to the same customer groups, are marketed through the same
types of outlets, or fall within given price ranges.

● It’s length can be stretched or filled.

Product mix

● Width: number of different product lines the company carries.

● Length: total number of items the company carries within its product lines.
● Depth: number of versions offered for each product.
● Consistency: how closely the various product lines are in end use,
production requirements, or distribution channels.
Major stages in New Product Development
Product Life Cycle
Place - Marketing channels
Supply chain

● Upstream partners: firms that supply products needed to create new ones.
● Downstream partners: marketing channels (distribution channels) that look
toward the customer.

There is a vision of demand chain: “sense and respond”.

Value delivery network: company, suppliers, distributors and customers.

Value added by each channel member
Channel levels
Vertical vs. horizontal
Multichannel distribution systems

A single firm sets up two or more marketing channels to reach one or more
customer segments.
Channel design decisions
Channel management decisions
 Promotion a.k.a Marketing Communications
(focus on IMC)
Advertising
Personal selling
Sales promotion
PR
Direct Marketing
4th P, Pricing
Cost based pricing
 Cost based pricing

Advantages
- A straightforward and simple strategy
- Ensures that all production and overhead costs are covered before profits are calculated
- Ensures a steady and consistent rate of profit generation
- In cases where the customers have enough knowledge about product costs and thus have an upper hand
Disadvantages
- May lead to under priced products
- May sometimes ignore consumer's role in the overall market
- Ignores price elasticity of demand
- May not take into account competition
Value based pricing

https://www.youtube.com/watch?v=MlcVnSy
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